Tax the fuel, not cars, say diesel auto makers

Alarmed by the Centre's toying with the idea of imposing an additional tax on the sales of diesel-run cars and sports utility vehicles, auto makers are teeming with alternate suggestions that include a dual pricing policy for diesel, and a 1% increase in the price of diesel.

Auto companies argue that diesel consumed by private vehicles is just 6.8% of total sales, which only 1.6% is consumed for personal use, the rest being used for commercial purpose (road transport industry).

Auto companies have big plans to capitalise on the demand for diesel vehicles and open new plants, which could well be put on hold if the finance ministry's recommendation is implemented as it will drive down vehicle demand.